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Ascension to share ownership of Carondelet Health Network with Tenet and Dignity

August 1, 2015

Tenet Healthcare Corp., Ascension and Dignity Health said on July 15 that they have agreed to a partnership in which they will together own and operate the financially struggling Carondelet Health Network, based in Tucson, Ariz.

St. Louis-based Ascension currently owns Carondelet Health Network. Dallas-based for-profit Tenet Healthcare Corp. will be the majority owner in Carondelet Health Network, which will become a for-profit, and Tenet will manage operations of Carondelet's three hospitals, related physician practices and outpatient and ambulatory services in Tucson and Nogales, Ariz. Ascension and San Francisco-based Dignity Health will have minority interests in the partnership. The facilities in the new partnership include the 486-bed St. Joseph's Hospital and the 400-bed St. Mary's Hospital, both in Tucson; the 25-bed Holy Cross Hospital in Nogales; the Carondelet Heart & Vascular Institute at St. Mary's Hospital; the Carondelet Neurological Institute at St. Joseph's Hospital; Carondelet Medical Group and Carondelet Specialist Group.

The partnership brings together three health care heavyweights — Tenet has about 125,000 employees, 81 acute care hospitals and 18 short-stay surgical hospitals in the U.S. Ascension, a Catholic health system, has about 150,000 employees and 131 hospitals in the U.S. Dignity Health, a faith-based system, has about 65,000 employees and 39 hospitals.

Tenet and Dignity Health separately own and operate hospitals and clinics in the Phoenix area and jointly manage an accountable care organization, the Arizona Care Network. That network currently includes about 130 patient care facilities with about 3,300 providers and more than 200,000 covered lives. Carondelet will be connected to the Arizona Care Network to increase "access to care for patients, strengthen and grow Carondelet's relationships with physicians, provide employee development opportunities for current and future employees and fund strategic growth initiatives across Southern Arizona," according to a news release.

The joint venture will maintain Carondelet's Roman Catholic heritage and identity through an agreement with the Diocese of Tucson. Carondelet's existing charity care policies will remain in place.

The transaction is expected to close in the third quarter of 2015. Financial terms were not disclosed. The systems did not comment beyond the news release about the deal.

 

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